A competency model can be a powerful tool for HR and organizations to ensure employees have the right skills and knowledge to meet business goals. It can enable you to address skills gaps, improve hiring decisions, and support employee development.
This article discusses the key benefits of an effective competency model, the different types, and how to develop and implement one in your organization.
Contents
What is a competency model?
When do you need a competency model?
The benefits of a competency model
5 types of competency models
Examples of competency models
7 steps to develop and implement a competency model
Best practices for maintaining and updating competency models
What is a competency model?
A competency model is a framework that defines the skills, knowledge, and behaviors an employee needs to succeed in a specific role. It differs from skills and competence in that it refers to a collection of specific things an employee must do to perform their job effectively. This collection helps guide recruitment, training and development, and performance evaluations.
Competency modeling should be tailored to an organization’s unique needs to align employee performance with the business’s wider vision and objectives.
Competency modeling vs. job analysis
Although these methodologies frequently overlap, here’s how competency modeling differs from job analysis.
Broadly focused.
Focused on a specific position.
Attributes, skills, and behaviors necessary for success across jobs or within a company.
Reflects the specific duties, responsibilities, and requirements of a job.
Future-oriented and applicable across the organization.
Task-specific and detailed.
Informs employee training and development needs, succession planning, and leadership development.
Informs recruitment criteria, performance standards, and job requirements.
Output is usually a competency framework.
Output is usually a job description or job specification.
When do you need a competency model?
Some common instances that call for a competency model are with succession planning, leadership development, recruitment and selection, and training and development programs.
Competency models are also critical during periods of organizational change—such as mergers and acquisitions or restructuring—as they help redefine roles and align new teams. They can also help if your company is experiencing performance issues (like underperformance in employees) by identifying skills gaps.
HR’s top burning question
How do we create effective competency models tailored to our organization’s needs?
A competency model is an organization’s blueprint for success. It outlines the knowledge, skills, and behaviors critical for success across various roles and business areas. When defining a competency model, it’s critical to link this to the overall organizational strategy and objectives.
For example, if the organization wants to be a leader in customer service, the competency model has to reflect the competencies employees need to achieve this. The competency model should then include competencies like communication, problem-solving, and interpersonal skills.
Annelise Pretorius, Psychometrics Assessments Expert, AIHR
The benefits of a competency model
The benefits of an effective competency model include:
- Targeted training and development: Understanding employee strengths and weaknesses helps you plan focused development programs that boost performance and hone useful skills.
- Improved performance management: It can provide a basis for consistent, objective performance evaluations and constructive feedback to support employees and facilitate growth.
- Succession planning: A good competency model can help identify future potential leaders and prepare them for leadership roles.
- Alignment with strategic goals: Using a competency model allows you to set SMART goals and ensure employee capabilities support organizational objectives.
- Strengthened retention plan: Competency modeling can give employees what they need to succeed, improve employee experience, and reduce turnover.
- Accountability and self-sufficiency: When employees understand what’s expected of them and have the knowledge and skills to do well, they can take charge of their success. They’ll also be more aware of the competencies needed to take on new roles.
5 types of competency models
Let’s explore some different types of competency models and what they’re used for:
- Organizational core competency model: This model evaluates an employee’s abilities and how they align with wider business objectives. It allows companies to understand and track core competencies and build a workforce aligned with organizational goals.
- Functional competency model: This model determines the skills needed to perform well in a specific role and ensures employees have the right competencies to do well.
- Job competency model: A job competency model breaks down the knowledge, skills, abilities, and behaviors needed for optimal performance in a role. It also lets employees see how well they meet job requirements and what they need to bridge any gaps.
- Leadership competency model: This model focuses on the competencies needed for leadership roles, helping organizations identify and develop potential future leaders for succession planning purposes.
- Custom competency model: A custom competency model (also called an industry-specific competency model) combines various elements from the above models based on organizational needs. Examples include:
- HR competency model: This model helps HR professionals develop the competencies needed to thrive now and in the future. It combines the core competencies of business acumen, data literacy, digital agility, people advocacy, and execution excellence with functional competencies that include specialist HR functions and leadership.
- Sales competency model: This model includes everything salespeople should know and be able to do in a sales environment. This includes market and industry understanding, communication skills, networking, negotiation, a sales mindset, and more.
HR’s top burning question
How can we gain leadership buy-in for competency modeling initiatives?
Articulate their strategic value by connecting them directly to business outcomes. Show how competency modeling aligns organizational goals with the skills and behaviors that drive performance, optimize workforce planning, and ensure the availability of critical capabilities.
Use language and examples that resonate with leaders and highlight how competency models solve familiar challenges, such as succession planning and execution. Illustrate the impact with compelling data or case studies that demonstrate measurable improvements in performance, hiring quality, and retention rates.
Last but not least, leaders should be engaged from the outset to build a sense of ownership, encouraging their input in defining core competencies.
Dr Dieter Veldsman, Chief Scientist (HR & OD), AIHR
Examples of competency models
Let’s explore the following 10 examples of competency models:
Example 1: AIHR’s T-Shaped HR Competency Model
Currently in its third iteration, AIHR’s T-Shaped HR Competency Model revolves around the idea of HR professionals needing to be ‘T-shaped’ to succeed in their roles. This means being a generalist in five core HR competencies and a specialist in at least one functional competency (depending on their role or organizational needs).
With the required skills for HR professionals constantly changing, possessing these generalist competencies alongside specialist expertise enables them to adapt to changing business needs and stay relevant.
Example 2: ATD’s Talent Development Capability Model
ATD’s Talent Development Capability Model guides talent practitioners in developing themselves, others, and their organizations. Research involving over 3,000 professionals has identified 23 capabilities—such as training delivery, data analytics, emotional intelligence, and decision-making—essential for success.
Example 3: SHRM Competency Model
SHRM conducted research involving thousands of HR professionals to develop the initial SHRM Competency Model, which defined eight core behavioral competencies crucial for HR success at any level.
These competencies are leadership and navigation, ethical practice, relationship management, communication, global and cultural effectiveness, business acumen, consultation, and critical evaluation.
Later, the model defined knowledge areas and added analytical aptitude as a ninth core behavioral competency. It also breaks down these competencies into sub-competencies, behaviors, proficiency stages, and career levels.
Learn to use competency modeling to benefit both employer and employee
A well-defined competency model can help identify skills gaps and align individual and company goals. To create the best model for your organization, you must be able to define key competencies, engage stakeholders, conduct job analysis, and integrate the model into your current systems.
In AIHR’s Talent Management & Succession Planning, you will learn to build an impactful leadership competency framework through skills-based talent-mapping.
This online, self-paced Certificate Program will also teach you methods to identify, develop, and engage potential future leaders in your organization.
Example 4: IBM’s Data Science Skills Competency Model
In 2018, growing demand for data scientists and a lack of trained professionals led IBM to introduce the first Data Science Apprenticeship program in the U.S. It included IBM’s Data Science Skills Competency Model, which mapped out the skills and competencies data scientists needed to succeed.
These included a foundation in statistics and programming, data science and preparation, model building and deployment, big data, and leadership and professional development. This blueprint can be used for recruitment, skills development, and job expectations.
Example 5: Lominger Competency Model
The Lominger Competency Model identifies key skills, behaviors, and characteristics necessary for effective performance in various roles in an organization. It outlines 67 competencies, grouped into categories like thought processes, interpersonal skills, self-management, and achieving results.
The model is widely used for leadership development, succession planning, and performance management. It is also flexible, allowing organizations to prioritize and adapt the competencies based on their needs. It provides a clear roadmap for individual and organizational growth, supporting better hiring, training, and career development decisions.
Example 6: Clifton Strengths
Gallup’s Clifton Strengths model focuses on identifying and using individual strengths to maximize performance and personal fulfillment. It measures 177 competencies and participants’ unique talents (natural patterns of thinking, feeling, and behaving), categorizing them into 34 themes.
This approach emphasizes that people perform best when they develop their natural talents instead of trying to fix weaknesses. It’s often used in personal development, team building, and leadership training and aims to foster engagement, productivity, and collaboration.
HR’s top burning question
How can competency models be integrated into recruitment and selection processes?
Begin by clearly defining the competencies needed for each role, focusing on specific, observable behaviors that meet the organization’s needs. Recruiters can use these competencies to create job descriptions based on performance indicators beyond formal qualifications.
Competency-based interview questions, assessments, and scoring rubrics help recruiters to practically evaluate candidates and ensure fair, relevant assessments. Competency models can also enhance onboarding, helping new hires develop key skills based on clear expectations and feedback.
Managers can use these models to guide professional development, identify growth areas, and outline career pathways. This ongoing process supports effective hiring and prepares employees for future roles, aligning talent with organizational goals.
Annelise Pretorius, Psychometrics Assessments Expert, AIHR
Example 7: SHL Universal Competency Framework
The SHL Universal Competency Framework (UCF) identifies 20 core competencies grouped into three categories: Thinking, Interacting, and Achieving. This framework is designed to be adaptable, offering insights into the skills required across industries and roles.
Companies use the UCF for talent acquisition, development, and performance management. It simplifies competency mapping using a universal language that aligns individual skills with organizational goals. Focusing on measurable and observable behaviors aids data-driven decisions, better hiring, leadership development, and career progression strategies.
Example 8: The European e-Competence Framework
The European e-Competence Framework (e-CF) is a standardized framework that outlines the key ICT competencies needed for digital economy roles. It includes 41 competencies grouped into five key areas: Plan, Build, Run, Enable, and Manage.
The framework provides a common language for assessing and developing ICT skills, promoting clarity and consistency in workforce development across Europe. It’s useful for job profiling, recruitment, training, and career development in ICT-related fields and aligns with European qualification standards.
Additionally, it supports individuals and organizations in matching skills with job requirements. By providing clear guidance on required competencies, the e-CF fosters professional mobility, skill recognition, and workforce readiness in the digital landscape.
Example 9: DDI
DDI’s competency framework is a comprehensive system that identifies and develops the key skills, behaviors, and attributes needed for success in various roles and industries. Its library of 114 competencies across 10 job categories comes with a development guide for each competency to help leaders understand what they must do to excel.
The framework supports talent assessment, succession planning, and leadership development with a structured approach to understanding and enhancing employee capabilities. Its flexible design also allows companies to tailor competencies to meet their needs while fostering a culture of continuous improvement.
Example 10: Drotter Leadership Pipeline Model
The Drotter Leadership Pipeline Model outlines six stages of leadership growth, from managing oneself to leading at the enterprise level. Each stage requires new skills, time focus, and work values, emphasizing the need to master each transition to progress effectively.
The model helps organizations develop leaders by clarifying role expectations and providing targeted training. It supports succession planning and ensures leaders are prepared for increasing responsibilities as they advance.
HR’s top burning question
How can we align competency models with our organization’s strategic goals?
Follow a structured process:
- Clarify strategic goals: Break down high-priority goals into specific objectives to understand the required competencies.
- Identify and map competencies: Define the critical skills, behaviors, and knowledge that align with strategic priorities.
- Conduct a gap analysis: Assess current competencies and identify critical gaps that need addressing.
- Develop targeted programs: Design programs that build these competencies, then integrate these into onboarding and career development paths.
- Embed in HR processes: Make sure recruitment, performance management, and succession planning focus on the required competencies for strategic success.
- Measure and adjust: Track progress through performance metrics, gather feedback, and adjust competencies as strategic priorities evolve.
Dr Dieter Veldsman, Chief Scientist (HR & OD), AIHR
7 steps to develop and implement a competency model
Here is a step-by-step guide to help you develop and implement a competency model in the workplace:
Step 1: Define your goals
The first step is to consider your objectives. Think about who will use the competency model and what their needs are to determine the specific competencies you’ll include. The model may be for a specific department, job function, or the entire company, and its purpose could be managing performance, engagement, recruitment, career development, etc.
Step 2: Conduct research
Before you develop your own competency model, take time to collect and analyze data from various sources to help you develop strong competencies. Factors to consider include:
- Organizational goals and strategies
- Current job descriptions
- The company’s current structures and hierarchies
- Past performance reviews
- Project reports
- Predictions for the future of the organization and industry
- Key workforce data
- Interviews with relevant departments and executives
- Relevant online research (competitors’ job ads, existing competency frameworks in other companies, etc.).
Step 3: Create a list of competencies
Establish a list of competencies in the following categories:
- Core competencies: These should reflect your organization’s values, goals, and culture and determine how employees should contribute in order to achieve their goals and integrate into the workplace.
- Job-specific competencies: These should reflect the skills, knowledge, and behaviors managers have specified as essential to perform well in different roles.
- Leadership competencies: If needed, these should focus on the skills and attributes leaders must cultivate to lead and manage teams effectively.
Step 4: Define each competency
Each competency needs a definition with specific and measurable components. For example, the competency of verbal communication could be defined as “the ability to effectively convey, listen to, and interpret verbal messages in a clear, concise, and empathetic manner”.
Step 5: Identify critical behaviors and actions
Create levels for each competency, such as beginner, intermediate, and expert, and identify behaviors and actions for each level so that reviewers have clear benchmarks for evaluation.
Step 6: Start building the model
Building your model typically involves the following process:
- Structure your model: Your model’s structure refers to the components you want to include and how to structure them, such as organizational goals and values, roles, technical skills, knowledge, and experience. Also, consider your competency model’s ideal form (e.g., flow chart or Venn diagram, etc.).
- Compile competency profiles: To maintain consistency, ensure you have sections for primary responsibilities, behavioral competencies, key knowledge, and technical and soft skills in the draft version of your competency model.
- Factor in proficiency levels: This includes defining each competency at different levels to help differentiate what ‘good’ looks like for different roles across the organization.
- Use a competency matrix: A competency matrix can help you map out competencies for various jobs in your company, showing which competencies are required for which roles and their proficiency levels.
- Finalize your list of competencies: Ensure they are relevant, objective, measurable, differentiated (minimum overlap with one another), and trainable.
To embed the competency model into the organization, ensure alignment between various HR practices. Practically, this means the desired behaviors aligned with the organizational culture are the same behaviors used to define successful performance and what the organization rewards.
Step 7: Plan the roll-out
Once you’ve finalized your model, you need to create an implementation plan for it. This entails:
- Training sessions: Begin with training sessions to get all employees and managers on board with the model and its accompanying changes. Communicate the model’s purpose company-wide, ensure managers know when and how to use it and create easily accessible guides with key information and FAQ.
- Pilot rollout: Trial the new competency model with one or two departments and collect feedback from a diverse group of employees across these departments. Use this feedback to make any necessary changes before implementing the model company-wide.
- Organization-wide rollout: After implementation, some people may struggle to adjust to the new system and need extra support. Be patient and take time to answer their questions. Point them to the resources you’ve prepared so they know where to look.
HR’s top burning question
How can we measure the impact of competency models on organizational performance?
Competency models describe what good performance looks like and clarify this for employees. Therefore, individual KPIs should reflect or be linked to your competency model. For example, if the organization is customer service-focused, competencies like communication, interpersonal skills, and problem-solving might be highlighted.
There should also be defined knowledge skills, and behaviors that are translated into KPIs. For example, a call center agent would be measured on client feedback, service quality, and adherence to service level agreements (which can be linked to the competencies).
Measuring these KPIs can indicate to what extent the requirements for success (as outlined in the competency model) lead to organizational performance.
Dr Dieter Veldsman, Chief Scientist (HR & OD), AIHR
Best practices for maintaining and updating competency models
Here are some best practices for HR to follow for maintaining and updating a competency model:
- Review and modify: Your competency model should evolve alongside your organization and the industry it’s in. Frequently review and revise your model to ensure it’s relevant and aligned with strategic objectives and emerging trends.
- Engage with stakeholders: Involve the entire workforce in the review process through one-on-one meetings, surveys, and questionnaires to gather diverse feedback and encourage buy-in.
- Encourage continuous learning: Foster a culture of growth in your organization where employees feel motivated and supported to improve their competencies and progress in their careers.
- Integrate into HR processes: Incorporate your competency model into your recruitment efforts, performance management, and training and development programs to reiterate its importance.
To sum up
A competency model helps bridge skills gaps by aligning employee performance with business goals. It improves recruitment, performance management, and employee development while preparing organizations for future challenges. Additionally, you can tailor models to ensure your company stays competitive and adaptable.
To maximize its impact, keep the model updated, involve stakeholders, and integrate it into HR processes. A well-maintained model fosters growth, enhances employee potential, and supports long-term success.
